During the festive break, Radio 4 had a series of experts compare last year with other years, because 2016 felt so momentous and unexpected that it needed some analysis of whether we could have seen it coming. The experts went back to 1914, and to the 1930s and in each case, they warned of more change still to come, and some of it not so good.
If you do the same analysis for the housing sector, you don’t need to go back decades. 2008/09 would probably do quite nicely. There are some notable similarities for 2016/17 but perhaps more optimistically for our sector, some promising differences.
The similarities. We will have institutional change, with a new housing investment agency, led by a local authority chief executive, re-purposed to be a significant land Agency working with local authorities and housing organisations across the country. We will have an independent regulator, no longer under the umbrella of a parent organisation.
We had and will have a range of new initiatives (though for some there is already a sense of déjà vu), accelerated delivery; starter homes mark 5 or 6 at the last count; garden villages; potential planning reform; and a genuine recognition that we are not building enough homes and that we need a step change.
We also have a very uncertain economic climate, with threats and risks to housing association business plans. This time it’s the implications of Brexit. In 2008/09, we were in the midst of a recession and had the mark to market call on a number of association’s cash reserves. Which by the way was handled extremely well by the then regulator, The Tenant Services Authority.
The differences, however are important to understand, and are crucial for our future.
Then we had a hiatus in funding from government and the sector’s annus horribilis – accusations in national media that the sector wasn’t doing enough to build the homes that were needed, and specifically homes to buy, rather than homes for rent. We struggled to understand why our significant contribution was not received with more appreciation or any gratitude. I suggested we needed Project 2020, the rebuild of our reputation.
During this period, housing associations have continued to build, and with diminishing amounts of government investment. We’ve hit and passed the tipping point where there is now more private debt and housing associations’ own resources funding their businesses and development programmes, than there is public subsidy. Those Associations committed to a genuinely affordable rent product have looked at how to finance it, rather than giving up on it. And grant and public subsidy is now increasingly part of an association’s funding portfolio, to support a wider range of tenures, rather than to underpin their development programmes.
Now, the announcement of £7.4 billion of public sector investment – which takes us back to the heady days of the 2008-11 £8.4 billion programme, and despite there being some repackaging of existing programmes, is the best settlement that we have had in a decade – is a programme for all tenures.
The difference is also our engagement with government, both central and regional. It of course helps that we have a government that is prepared to be engaged. But I hear less whingeing, more doing. And some of the doing may well be game changing. The pre-Christmas announcement that Your Housing is entering into partnership with a Chinese National Building Material Company, is a sign that the sector is taking control of its own development destiny. Partnerships are being formed with local authorities to combine the sector’s balance sheet with authorities’ land assets and planning powers. I love Placeshapers, simple message, regularly tweeted, of the contributions that its members are making to develop 36,000 new homes.
There is still work to do. The least efficient, least accountable and least responsive of us diminish the reputation of the many. As a sector we are not yet a local authority’s key strategic partner, and this is a trick that I think we’ve missed. As was the opportunity, with a few notable exceptions, during all of the Cathy Come Home 50th anniversary coverage, to highlight to the wider public that a whole generation of associations were formed at that time and that our contribution has been vital.
If history repeats itself, then the forthcoming White paper will be bold, and ambitious, but the challenge will be delivery: land; planning and methods and costs of construction. This the sector already knows. How we engage and deliver during 2017 and over the next few years encourages me to believe that project 2020 is achievable. Our role as key delivery partners reconfirmed.